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This is an article to build English skills for science and business.


Business Practice and the Scientific Method

by Byron Jennings, PhD

Origins of the ISO 9001 standard

Would you believe that good business management practice is based on the scientific method? Well it is, and quite deliberately so.

International Standards Organization 9001

International standards from the International Standards Organization (ISO) use a variation of the scientific method as part of their standards. National standard organizations then pick up these standards and certify them for national use. This occurs in Canada with the Canadian Standards Association (CSA), in the USA with the American National Standards Institute (ANSI), in India with the Bureau of Indian Standards (BIS) and in many other countries.

Quality control Manufacturing

The story of the scientific method in business management starts with Walter Shewhart, who pioneered the use of statistics in manufacturing quality control in the 1920s. He also explicitly introduced the use of the scientific method in quality control.

Shewhart identified the specification, production and inspection steps in the manufacturing process with the hypothesis, experiment and test steps of the scientific method. Up to that point, quality control in manufacturing was largely confined to inspecting products and rejecting those items that failed the inspection. This led to waste and lost profit, as only items that passed the inspection could be used.

Shewhart's idea was that the original plan should have predictions that could be checked when the finished product was inspected. The information gained was used to improve the specifications and the manufacturing process.

Plan, Do, Check, Act Cycle

Shewhart’s idea was refined by Edwards Deming as the plan, do, check, act (PDCA) cycle. Deming gave a series of lectures in Japan in the 1950s on business management and these lectures laid the groundwork for the success of Japanese businesses in the following decades. The ideas were later picked up in the USA and influenced the ISO standards.

PDCA and the Scientific Method

The PDCA cycle is very much like the cycle in the scientific method. The plan step corresponds to the model building or hypothesis step in the scientific method. The do step corresponds to doing an experiment, while the check step corresponds to comparing the predictions of the scientific model to new observations. The act step corresponds to improving the scientific model in light of new observation.

The idea is that in business, you first plan your activity. As part of the plan, first you make predictions for how you expect the activity to proceed. Second, you perform the activity. Third, you check the results against the predictions of the plan. Fourth, you act to correct any problems identified.

The crucial point is that predictions made as part of the plan are compared to actuals, a fancy business word for observations, and corrections made.

ISO 9001 and the PDCA cycle

Where does this occur in the ISO management standards? Consider what is probably the best known of ISO standards, ISO 9001 on quality management. That standard is so well known that it is even referred to in cartoons. It is also a requirement in some industries that businesses be certified to this standard. Worldwide there are over a million ISO 9001 certified businesses.

In the ISO 9001 standard there are not one but two diagrams in the introduction that show the PDCA cycle. The PDCA cycle is even reflected in the outline of the document. Similarly, the PDCA cycle is present in all the various ISO management standards that I am familar with. It is even in the template for producing new ISO standards.

It is striking that in business, where mistakes can lead to the failure of companies, the scientific method forms the backbone of industry standards. Historically, when only the best quality will do, business standards developers turn to the scientific method for the answer.

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